Its funny, I keep seeing people saying that 200 upfront and 240 spread out over 2 years is the same as 440. It simply isn't. There are two things to consider: inflation and interest. Inflation tells me that a dollar today is worth more than a dollar tomorrow (and don't even pretend that we have deflation coming, if we do then our cell phone plans are the least of our troubles), making the net cost of the product lower if you spend the money over time. Interest means that I can take the money I didn't spend today and invest it, divesting slowly over 2 years to reap the profits of my unquestionably brilliant investment strategy (one word folks, AAPL) -- meaning that if AAPL grows at the same rate it did in 2004, then my iPhone will end up costing me -$400!
that's much cheaper than $440.
if they charged you interest, then it would be a different story (which is why layaway plans are not in your best interest).
I am confused. How much total does Apple get per phone. It sounds like its 199+325 or 524.
Thats more than before
$624 when bought from the Apple Store, according to the story, and thus another way to add to AI's coffers and deplete ATT's.....
There also seems to be a bigger story that's not being reported (that I've seen) and commented on here.
ATT was Apple's first completed stab at negotiating with a Cellco. Obviously they've accumulated lots of experience around the globe since then.
Soooo.... .....SJ announced the $199 US was going to apply to all the 7/11 rollout countries. Now $199 is probably below their cost of production, but they'll make a nice profit from the subsidies.
And they've effectively at the same time replaced the incremental revenue stream from ATT with anticipated incremental revenue from two new sources -- direct iTunes sales to the phones and new sales from the AppStore. (Hey, I just realized AppStore is a double entendre!! "Applications" and "Apple" can both be abbreviated as "App." Those clever marketing bastards are at it again. )
So does that mean Apple's negotiated similar rebate agreements with every company they've partnered with in every country?? Pretty major negotiating if so. And brilliant if true.
This is one company that's really learning how to execute both tactically and stragetically......
...even if "mobileMe" will take some getting used to.....
AT&T clearly state that their early termination fee is USD 200 -- and if you terminate within 1M, you pay USD 200 and return the iPhone, after 1M you can even keep the phone.
Does this "analyst" mean to say that you can now buy an iPhone from AT&T for 199 USD, keep it for a month at the minimum monthly price of 70 USD, and then legally break the contract paying them 200 USD? - -and AT&T will then be in the hole for 55USD?
And even worse, if you bought the phone from an Apple store, AT&T will be in the hole for 155 USD?
Not only will they expose themselves to this risk, but they will also expose themselves to the risk of jailbreaking?
Last time I checked, AT&T was in the business of ripping people off - not getting ripped off themselves.
This is just some idiot analyst trying to talk Apple stock up - do you actually think AAPL would be up just 2 USD if the market bought this story?
AT&T clearly state that their early termination fee is USD 200 -- and if you terminate within 1M, you pay USD 200 and return the iPhone, after 1M you can even keep the phone.
If you return the 3G iPhone within 30 days you pay NO termination fee. There will probably be a 10% restocking fee if the device is opened, which is usual for Apple products.
After that 30 days you are required per the contract to pay for the services agreed upon by said contract. If you wish to cancel your contract before you are eligible for an upgrade—which I think is 22 months—you will be charged a $200 cancelation fee per the aforementioned contract.
As an AT&T employee let me fill you in on a few things.
There are 2 major data plans for AT&T (There are actually tons but they are just different versions of this plan.)
PDA Personal/Blackberry/Iphone 3G - $30 a month unlimited. The basically rule of this one is that if the phone has a QWERTY keyboard, it fits in this category. The only exception I can think of is the blackberry pearl which doesn't have a true QWERTY keyboard.
Media Net unlimited - $15 a month unlimited. Applies to regular phones as well as smart phones like the N95, touchscreen LG VU, or even the old HTC 3125 which ran windows mobile but was a clamshell phone.
The fact that the phone is 3G means absolutely nothing in regards to the data plan. By the end of the year I would bet 95% of the phones we sell are 3G. It is much more efficient with bandwith which saves the company a lot of money. The reason, I believe, the company charges more for keyboard phones is that they figure if you have a keyboard you will tend to email and use more data
I also HIGHLY doubt AT&T is subsidizing the phone by $325. Even $200 is A LOT for a subsidy. Usually a phone is only subsidized by about $50-$100. Without naming an exact phone, Pretend we sell a phone for $50 dollars, we buy that phone for around $100. Even though retail of that phone is listed as $200. The bigger subsidies tend to be on phones with data plans like the blackberries. These phones can be subsidized up to $150. So for the iphone to be nationally subsidized by $200 is huge. You can bet that AT&T wasnt paying 400 dollars for the original iphone and they wont be paying full price for the new one. I'm giving a 1% chance that the phone is subsidized by $325.
I also HIGHLY doubt AT&T is subsidizing the phone by $325. Even $200 is A LOT for a subsidy. Usually a phone is only subsidized by about $50-$100. Without naming an exact phone, Pretend we sell a phone for $50 dollars, we buy that phone for around $100. Even though retail of that phone is listed as $200. The bigger subsidies tend to be on phones with data plans like the blackberries. These phones can be subsidized up to $150. So for the iphone to be nationally subsidized by $200 is huge. You can bet that AT&T wasnt paying 400 dollars for the original iphone and they wont be paying full price for the new one. I'm giving a 1% chance that the phone is subsidized by $325.
The iPhone may be a more expensive phone and Apple's negotiating skills along with the high profile and desire for this handset will drive the subsidy up.
As for the full, unlocked retail price of the 3g iPhone, it may be considerably higher than the $400 or $525 people are hoping for:
does anyone know the cost to a telecom of a NEW SMARTPHONE customer, i bet it's huge
iphone more than ANY OTHER SMARTPHONE, easily grows their customer base, with all the publicity it's going to go gangbusters, so will any telecome with this phone. what other phone can do this for a carrier.....also once a carrier gets a smartphone user its hard to wrestle them away, unless you have the iPhone
also maybe the revenue sharing thing HURT apple, remember, they had to put off revenue because it was delayed, now it's up front and they can use it now....will build the stock price faster and is more accurate. so maybe the revenue model worked against apple revenue reporting and revenue stream.
doesn't gps gost extra on other carriers, maybe that's why the extra $10, or just greedy bastards (yea yea)
i think several things we have been wanting will come as a way to support the developers
e.g. cut and paste, voice dialing, sms etc so everyone feeds at the fountain.....on our dollar.
i think the future will be like sprint. all services at one price, but i don't sms, or text so i just want voice and data, and minimal sms, text. it will be a "a la cart" and milk you for what you really want. also the apps store will consume many more $$$$
so the stock should go up......go up....stop going down....aapl please go up then split.
does anyone know the cost to a telecom of a NEW SMARTPHONE customer, i bet it's huge. iphone more than ANY OTHER SMARTPHONE, easily grows their customer base, with all the publicity it's going to go gangbusters, so will any telecome with this phone. what other phone can do this for a carrier.....also once a carrier gets a smartphone user its hard to wrestle them away, unless you have the iPhone.
There is also evidence to suggest that the iPhone has made samrtphones cool and have brought them into the public's eye?the same way it did for Mp3 players?which has increased the sales of other smartphones.
Exactly. I'm getting tired of all these people claiming AT&T has *raised* the price on iPhone's data plan. Simply not true. The cost of a 3G data plan from AT&T for ANY phone has always been $30 a month.
Let's try and keep up people, this info is common knowledge.
Its true that some 3G plans are $30 but my Samsung Sync is only $15 a month for unlimited 3G (I tether too but that's a secret). I believe Smartphones have the $30 3G unlimited data plan, which falls in line with Att's pricing. I'll be upgrading whenever Att says I'm eligible (which is in August according to their website). An extra $15 for me for data but for how much more I'll be using it is far worth it.
Its true that some 3G plans are $30 but my Samsung Sync is only $15 a month for unlimited 3G (I tether too but that's a secret)... An extra $15 for me for data but for how much more I'll be using it is far worth it.
Don't forget you'll loose tethering unless a jailbroken v2.0 firmware comes out (which is quite possible), but not guaranteed
I also HIGHLY doubt AT&T is subsidizing the phone by $325. Even $200 is A LOT for a subsidy. Usually a phone is only subsidized by about $50-$100.
But Apple & iPhone are not "usual".
Quote:
You can bet that AT&T wasnt paying 400 dollars for the original iphone
But they were paying Apple $12-$18 per month for 24 months in addition to what they did pay for the phone.
Quote:
and they wont be paying full price for the new one.
What is full price? Since they are only available from Apple/ATT with a plan, the price is the price. Not like there's any other place selling them to compare them with.
Comments
Or maybe he owns AAPL and he is counting on making a bunch more from Apple than he pays to at&t...
Good post. Since I"m a share holder I would welcome it!
that's much cheaper than $440.
if they charged you interest, then it would be a different story (which is why layaway plans are not in your best interest).
I am confused. How much total does Apple get per phone. It sounds like its 199+325 or 524.
Thats more than before
$624 when bought from the Apple Store, according to the story, and thus another way to add to AI's coffers and deplete ATT's.....
There also seems to be a bigger story that's not being reported (that I've seen) and commented on here.
ATT was Apple's first completed stab at negotiating with a Cellco. Obviously they've accumulated lots of experience around the globe since then.
Soooo.... .....SJ announced the $199 US was going to apply to all the 7/11 rollout countries. Now $199 is probably below their cost of production, but they'll make a nice profit from the subsidies.
And they've effectively at the same time replaced the incremental revenue stream from ATT with anticipated incremental revenue from two new sources -- direct iTunes sales to the phones and new sales from the AppStore. (Hey, I just realized AppStore is a double entendre!! "Applications" and "Apple" can both be abbreviated as "App." Those clever marketing bastards are at it again.
So does that mean Apple's negotiated similar rebate agreements with every company they've partnered with in every country?? Pretty major negotiating if so. And brilliant if true.
This is one company that's really learning how to execute both tactically and stragetically......
...even if "mobileMe" will take some getting used to.....
Does this "analyst" mean to say that you can now buy an iPhone from AT&T for 199 USD, keep it for a month at the minimum monthly price of 70 USD, and then legally break the contract paying them 200 USD? - -and AT&T will then be in the hole for 55USD?
And even worse, if you bought the phone from an Apple store, AT&T will be in the hole for 155 USD?
Not only will they expose themselves to this risk, but they will also expose themselves to the risk of jailbreaking?
Last time I checked, AT&T was in the business of ripping people off - not getting ripped off themselves.
This is just some idiot analyst trying to talk Apple stock up - do you actually think AAPL would be up just 2 USD if the market bought this story?
AT&T clearly state that their early termination fee is USD 200 -- and if you terminate within 1M, you pay USD 200 and return the iPhone, after 1M you can even keep the phone.
If you return the 3G iPhone within 30 days you pay NO termination fee. There will probably be a 10% restocking fee if the device is opened, which is usual for Apple products.
After that 30 days you are required per the contract to pay for the services agreed upon by said contract. If you wish to cancel your contract before you are eligible for an upgrade—which I think is 22 months—you will be charged a $200 cancelation fee per the aforementioned contract.
There are 2 major data plans for AT&T (There are actually tons but they are just different versions of this plan.)
PDA Personal/Blackberry/Iphone 3G - $30 a month unlimited. The basically rule of this one is that if the phone has a QWERTY keyboard, it fits in this category. The only exception I can think of is the blackberry pearl which doesn't have a true QWERTY keyboard.
Media Net unlimited - $15 a month unlimited. Applies to regular phones as well as smart phones like the N95, touchscreen LG VU, or even the old HTC 3125 which ran windows mobile but was a clamshell phone.
The fact that the phone is 3G means absolutely nothing in regards to the data plan. By the end of the year I would bet 95% of the phones we sell are 3G. It is much more efficient with bandwith which saves the company a lot of money. The reason, I believe, the company charges more for keyboard phones is that they figure if you have a keyboard you will tend to email and use more data
I also HIGHLY doubt AT&T is subsidizing the phone by $325. Even $200 is A LOT for a subsidy. Usually a phone is only subsidized by about $50-$100. Without naming an exact phone, Pretend we sell a phone for $50 dollars, we buy that phone for around $100. Even though retail of that phone is listed as $200. The bigger subsidies tend to be on phones with data plans like the blackberries. These phones can be subsidized up to $150. So for the iphone to be nationally subsidized by $200 is huge. You can bet that AT&T wasnt paying 400 dollars for the original iphone and they wont be paying full price for the new one. I'm giving a 1% chance that the phone is subsidized by $325.
I also HIGHLY doubt AT&T is subsidizing the phone by $325. Even $200 is A LOT for a subsidy. Usually a phone is only subsidized by about $50-$100. Without naming an exact phone, Pretend we sell a phone for $50 dollars, we buy that phone for around $100. Even though retail of that phone is listed as $200. The bigger subsidies tend to be on phones with data plans like the blackberries. These phones can be subsidized up to $150. So for the iphone to be nationally subsidized by $200 is huge. You can bet that AT&T wasnt paying 400 dollars for the original iphone and they wont be paying full price for the new one. I'm giving a 1% chance that the phone is subsidized by $325.
The iPhone may be a more expensive phone and Apple's negotiating skills along with the high profile and desire for this handset will drive the subsidy up.
As for the full, unlocked retail price of the 3g iPhone, it may be considerably higher than the $400 or $525 people are hoping for:
iphone more than ANY OTHER SMARTPHONE, easily grows their customer base, with all the publicity it's going to go gangbusters, so will any telecome with this phone. what other phone can do this for a carrier.....also once a carrier gets a smartphone user its hard to wrestle them away, unless you have the iPhone
also maybe the revenue sharing thing HURT apple, remember, they had to put off revenue because it was delayed, now it's up front and they can use it now....will build the stock price faster and is more accurate. so maybe the revenue model worked against apple revenue reporting and revenue stream.
doesn't gps gost extra on other carriers, maybe that's why the extra $10, or just greedy bastards (yea yea)
i think several things we have been wanting will come as a way to support the developers
e.g. cut and paste, voice dialing, sms etc so everyone feeds at the fountain.....on our dollar.
i think the future will be like sprint. all services at one price, but i don't sms, or text so i just want voice and data, and minimal sms, text. it will be a "a la cart" and milk you for what you really want. also the apps store will consume many more $$$$
so the stock should go up......go up
does anyone know the cost to a telecom of a NEW SMARTPHONE customer, i bet it's huge. iphone more than ANY OTHER SMARTPHONE, easily grows their customer base, with all the publicity it's going to go gangbusters, so will any telecome with this phone. what other phone can do this for a carrier.....also once a carrier gets a smartphone user its hard to wrestle them away, unless you have the iPhone.
There is also evidence to suggest that the iPhone has made samrtphones cool and have brought them into the public's eye?the same way it did for Mp3 players?which has increased the sales of other smartphones.
Exactly. I'm getting tired of all these people claiming AT&T has *raised* the price on iPhone's data plan. Simply not true. The cost of a 3G data plan from AT&T for ANY phone has always been $30 a month.
Let's try and keep up people, this info is common knowledge.
Its true that some 3G plans are $30 but my Samsung Sync is only $15 a month for unlimited 3G (I tether too but that's a secret). I believe Smartphones have the $30 3G unlimited data plan, which falls in line with Att's pricing. I'll be upgrading whenever Att says I'm eligible (which is in August according to their website). An extra $15 for me for data but for how much more I'll be using it is far worth it.
Its true that some 3G plans are $30 but my Samsung Sync is only $15 a month for unlimited 3G (I tether too but that's a secret)... An extra $15 for me for data but for how much more I'll be using it is far worth it.
Don't forget you'll loose tethering unless a jailbroken v2.0 firmware comes out (which is quite possible), but not guaranteed
I also HIGHLY doubt AT&T is subsidizing the phone by $325. Even $200 is A LOT for a subsidy. Usually a phone is only subsidized by about $50-$100.
But Apple & iPhone are not "usual".
You can bet that AT&T wasnt paying 400 dollars for the original iphone
But they were paying Apple $12-$18 per month for 24 months in addition to what they did pay for the phone.
and they wont be paying full price for the new one.
What is full price? Since they are only available from Apple/ATT with a plan, the price is the price. Not like there's any other place selling them to compare them with.
Phone contracts suck.
What was your first clue??
That is what it sounds like to me.
Don't forget the 299 on 16gigs.